Tóm tắt Luận án Improving the current corporate income tax in Vietnam

Nội dung tài liệu: Tóm tắt Luận án Improving the current corporate income tax in Vietnam

1. MINISTRY OF EDUCATION MINISTRY OF FINANCE AND TRAINING ACADEMY OF FINANCE LE THI MINH PHUONG IMPROVING THE CURRENT CORPORATE INCOME TAX IN VIETNAM Major: Finance - Banking Code: 9.34.02.01 SUMMARY OF DOCTORAL THESIS IN ECONOMICS HA NOI - 2019
2. The thesis was completed at the Academy of Finance Scientific advisors: 1. Assoc.Prof. VUONG THU HIEN 2. Assoc.Prof. HOANG VAN BANG Examiner 1: Examiner 2: Examiner 3: The thesis is to be presented at the thesis council at academy level held at the Academy of Finance At.....hour.....day.........month.......year 2019 The thesis is available at the National Library of Vietnam and the library of the Academy of Finance
3. 1 PREFACE 1. Urgency of the thesis topic Corporate income tax (CIT) is a very important type of tax in the tax system of a country. It does not only help generate large revenue for the state budget but it also serves as a very effective tool for the government in regulating the macro economy and adjusting the behavior of enterprises, production and business organizations in the economy. A well-organized and well-managed CIT has significant impact on the economy’s development. In this context, the writer chose “Improving the current corporate income tax in Vietnam” as the thesis topic in order to find a number of solutions with scientific grounds and practical meaning. These solutions focus on improving the effectiveness of CIT policy and administration in the coming time in a timely manner to bring into play the role of tax policies in mobilizing tax revenue, regulating and promoting Vietnam’s socio-economic development. With such significance, it is necessary and urgent to study the thesis topic. 2. Research objective Overall objective: Recommendting a number of solutions to improve CIT policy and administration with scientific grounds and in line with the reality of CIT in Vietnam to improve the effectiveness of CIT policy and administration, make sure that CIT mobilize revenue for the state budget and help regulate and promote Vietnam’s socio-economic development during 2020 -2025 with vision to 2030. Specific objectives: Firstly, clarifying theoretical issues about CIT policy and administration as the basis for evaluating the reality of CIT in Vietnam nowadays and looking for solutions to improve CIT in Vietnam during 2020 - 2025 with vision to 2030. Secondly, studying theoretical basis and building models to analyze and evaluate the impact of tax rate and changes of CIT policy on economic development. Thirdly, synthesizing, analyzing, commenting and evaluating the reality of CIT in Vietnam during 2000 - 2018; clarifying achievements, shortcomings and reasons for such shortcomings. Fourthly, giving orientations and proposing important solutions to improve CIT in Vietnam in both aspects: CIT policy and CIT administration.
4. 2 3. Research questions To achieve the above-mentioned objective, the writer focuses on answering the following questions: (1) Which model and method should be used to evaluate the results of implementing CIT policy in order to achieve high reliability. (2) What is the evaluation of achievements and shortcomings of CIT policy and administration in Vietnam during 2000 - 2018? (3) What are solutions to improve CIT policy in Vietnam during 2020 - 2025? (4) What are solutions to improve CIT administration during 2020 - 2025? 4. Research objects and scope 4.1. Research objects The thesis’s research objects are theoretical and practical issues related to CIT policy and administration. 4.2. Research scope - Scope of CIT administration subjects: Tax administration bodies at levels and tax administration of tax payers that are enterprises operating under the Enterprise Law excluding: (i) taxpayers as individual household businesses, non-business organizations. and armed forces not operating under the Enterprise Law; (ii) tax administration activities of customs authorities. - Scope of content: The thesis inherits results from related scientific studies and focuses on clarifying the theoretical framework of CIT policy and administration. The thesis studies the contents of CIT policy and administration. - Scope of space and time: CIT in Vietnam during 2000 -2018, specifically CIT policy and administration in Vietnam during three periods: (i) 2000 - 2006; (ii) 2007 - 2011; and (iii) 2012 -2016 with forecast 2020 -2025 and vision to 2030. Secondary data are mainly collected from General Statistics Office (GSO), the Ministry of Planning and Investment (MPI), and the Ministry of Finance (MOF). Primary data are synthesized by the writer from report of tax agencies such as Ha Noi Tax Department and General Department of Taxation. 5. Research data and methodologies 5.1. Research data Data in the thesis include macro data of Vietnamese economy, micro data of annual enterprise survey from the General Statistics Office and Ministry of Planning and Investment.  Data used for evaluating the impact of CIT: macro approach
5. 3 The writer uses quarterly data from 2000 to 2018 with data sources mainly from the GSO and MPI.  Data used for analyzing and evaluating the impact of CIT: micro approach In this part, the writer uses the enterprise survey data set of the GSO and MPI from 2000 to 2018. Such data set has been used by the GSO for annual survey since 2001. In the data set, the writer eliminates some variables due to statistical error, such as: capital, number of employees, business age with negative sign, incomplete answers or the enterprises has not declared the tax code.  Variable description Variable Meaning Source symbol GDP Gross Domestic Product GSO K Gross fixed capital formation GSO L Labor GSO TAXCOP Corporate income tax MOF TAXOTH Other tax, calculated by subtracting corporate income taxes from total tax collection FDI Foreign direct investment GSO GC Goverment spending GSO CPI Customer price index GSO In which, - GDP: Gross Domestic Product, collected from GSO with 2010 as the base year. For the chain to end in first order logarithmic difference, the writer removes the chain’s seasonality by using Holt-Winters' seasonal method (unit: billion dong). - Customer price index (CPI): collected from the GSO with 2010 as the base year (unit: percentage) - Variable TAXCOP and TAXOTH are collected from MOF and converted to real value by dividing to GDP’s deflation. - GC: collected from GSO using 2010 as the base year (unit: billion) - FDI collected from GSO using 2010 as the base yea (unit: billion) For descriptive statistics of variables, see Annex 2. 5.2. Research methodologies Methods applied in the thesis include:
6. 4 Statistical comparison method; synthesis analysis method; Quantitative method: used for modeling the impact of CIT on economic entities. Soft wares used for data analysis in the thesis include: Eview 10 and Stata 14. 6. Scientific and practical significance of the thesis topic * Scientific significance: Firstly, the thesis systemizes and clarifies basic theories of CIT policy and administration, namely concepts, characteristics, principles, methods of establishing CIT policy and administration, and influencing factors of CIT policy and administration. These important issues serve as the basis for evaluating and improving CIT policy and administration in Vietnam. Secondly, the thesis studies and summarizes main orientations in improving CIT in countries in the world to draw lessons for Vietnam. The thesis focuses on important conclusions in terms of clarifying, simplifying and creating transparency in deductible expenses when identifying taxable income; cutting down on a number of expenses such as depreciation, interest...; adjusting common CIT tax rate; narrowing fields and industries eligible for preferential tax rates and focusing on spearhead industries and difficult areas; and finding effective solutions to prevent transfer pricing and tax losses. Thirdly, the thesis applies the theoretical basis and builds a model to evaluate the impact of CIT on revenue, labor, productivity, profit of enterprises; assess the impact of CIT on CIT tax revenue and total tax revenue by applying quantitative methods to approach the research issue in two aspects: macro approach (by applying the studies of Mansouri, Fossu & Magnus, and Sakyi) and micro approach (by applying the two-factor production function model of Varian and Fuss & McFaden and Cobb–Douglas production function model). Fourthly; the thesis provides a relatively in-depth and comprehensive evaluation of CIT policy and administration in Vietnam during 2000 - 2018; the thesis also clarifies positive impacts of this tax on the economy. Epecially, the thesis points out shortcomings and reasons for shortcomings in specific contents of CIT policy and administration in Vietnam. Fifthly, the thesis proposes important solutions regarding CIT policy and administration.
7. 5 * Practical significance: Firstly, thesis serves as a good reference material in teaching and studying policy and administration of CIT as well as basic theories of the model for evaluating the impacts of tax rate and changes of CIT policy. Also, authorized state administration agencies can refer to the thesis’ explanations and proposals in building and implementing tax reform policies in the coming time. Secondly, the thesis proposes five groups of solutions to improve CIT policy and three groups of solutions to improve CIT administration. These solutions focus on important issues of CIT, shortcomings and reasons for shortcomings of corporate income tax in Vietnam. Some solutions are explained comprehensively and have both theoretical and practical grounds; they are new recommendations such as: revising regulation of deductible expenses; revising and adding regulations on preferential income tax, improving supervision and inspection of CIT 7. Structure of the thesis In addition to the preface and conclusion, the thesis is comprised of four chapters: Chapter 1: Overview of studies on corporate income tax Chapter 2: Theoretical basis of corporate income tax Chapter 3: Reality of corporate income tax in Vietnam Chapter 4: Some solutions to improve corporate income tax in Vietnam CHAPTER 1: OVERVIEW OF STUDIES ON CORPORATE INCOME TAX 1.1. Local researches: During these times, there have been many domestic works on tax policies and CIT policy in the form of dissertations, theses, scientific research works or scientific articles published in specialized journals. There are 10 doctoral theses, 03 scientific research topics related to tax policy and CIT policy. In recent years, there has not been any scientific work at ministry level or doctoral thesis that directly studies CIT administration in Vietnam. There have been a number of scientific works by scientists, managers, graduate and postgraduate students and graduate students related to this issue. Besides the achieved results, even though these scientific works still have contents related to CIT administration or CIT policy, such contents have not been mentioned or analyzed in detail. Therefore, on the basis of inheriting results of previous studies
8. 6 on CIT policy and administration (with 07 doctoral thesis studies and 02 scientific research topics as representative studies), the writer continues to develop, supplement, update and have new research directions in this thesis. In summary, up to now, there have been many doctoral thesis about tax administration in general and CIT administration in Vietnam in particular according to different perspectives but there has been no study about CIT in Vietnam similar to this thesis topic. 1.2. International researches There are four international studies on CIT policy and four studies on CIT administration. 1.3. Assessment of research results These works were carried out at specific stages of economic, cultural, political and institutional environments. There is no uniformity in the environment and historical circumstances in different countries, in different historical periods. In addition, there exist differences in political, cultural, economic and educational backgrounds; therefore, according to the writer, it is necessary to study CIT in a specific country and in a specific period to help improve CIT policy and administration in accordance with the characteristics of each country in each period. Theoretical issues about CIT need to be developed and added to match with the reality. Therefore, it is necessary to continue studying and proposing specific solutions with more practical results. 1.4. Research gap Firstly, studies in other countries are not applicable to Vietnam due to different socio-economic conditions. Secondly, previous studies were mainly about CIT policy or administration only; frequent changes in reality requires policy and administration to be adjusted accordingly. Thirdly, there has been no comprehensive study on CIT policy and administration or impact assessment by econometric model to have more scientific and practical arguments for proposing solutions to improve CIT in Vietnam in the new context.
9. 7 CHAPTER 2: THEORETICAL BASIS OF CORPORATE INCOME TAX 2.1. Corporate income tax 2.1.1. Concept and characteristics of CIT Based on the dialectical argument for the existence of CIT, it is possible to consider the concept as CIT as follows: “Corporate income tax is a tax calculated on taxable income of enterprises in the tax period”. 2.1.2. Role of corporate income tax Theoretically, CIT is one of the most important type of taxes in the tax system; it performs the roles of the tax system in general, namely: (1) regulating income and ensuring social equality; (2) being a significant revenue source of the state budget; (3) encouraging and promoting production and business, encouraging investment in certain fields and localities in certain periods. 2.2. Corporate income tax policies 2.2.1. The concept of tax policies and corporate income tax policies “Policy” is the term commonly used in documents and media; however it is very difficult term to define in a specific and clear way. From the analysis of the concepts of policies, public policies and tax policies mentioned previously, it is possible to introduce the concept of CIT policy as follows: “Corporate income tax policy is a set of interrelated decisions issued by the government, including goals and solutions to regulate a portion of organizations’ income in the society, used by the government to achieve certain goals”. Thus, studying tax policy means studying goals that the tax policy aims at, the economic content of each tax and other necessary tools for the tax policy to to achieve its goals. 2.2.2. Principles and methods of creating corporate income tax policy 2.2.2.1. Principle of creating corporate income tax policy Even though the scope of coverage, subjects of application, tax rates or CIT preferences are different in countries, the following basic principles are strictly applied in creating CIT policy: taxing based on the principle of permanent establishment, taxing based on income from which expenses for creating income is deducted; determining tax year.
10. 8 2.2.2.2. Method of creating corporate income tax policy Theoretically, there exist three models for creating CIT policy: taxing on each source of income generation; taxing on total income; mixed tax. 2.2.3. Content of corporate income tax policy 2.2.3.1. Taxpayer Taxpayers of CIT are organizations with business, production and service activities and taxable income, including: Enterprises established and operating under regulations of Enterprise Law, Investment Law, the Law on Credit Institutions, Insurance Business Law, Securities Law, Petroleum Law, Commercial Law and the provisions of other legal documents in the forms: Joint stock companies, limited liability companies, partnerships, private enterprises, the parties in a business cooperation contract, the parties in petroleum product sharing contract, petroleum joint venture enterprises and joint operating companies. 2.2.3.2. Grounds for calculating tax Tax is calculated based on taxable income and tax rate 2.2.3.3. Method of calculating tax CIT payable = (Assessable income - Amount transferred to science and technology fund (if any) x CIT tax rate 2.3. Corporate income tax administration 2.3.1. The concept of corporate income tax administration CIT administration is a specialized administration field; therefore, to approach the concept of CIT administration, it is necessary to approach the concept of administration beforehand. This thesis agrees to the viewpoint that “Corporate income tax administration is the deliberate impact of state authorities on the process of calculating and collecting corporate income tax in order to generate revenue for the state budget and achieve the government’s goals”. Within the scope and content of this thesis topic, the thesis focuses on CIT administration in a narrow sense, only covering the activities of tax authorities in implementing administration contents in order to carry out legal policies on CIT. 2.3.2. Characteristics of corporate income tax administration Coming from characteristics of CIT, CIT administration has its own distinctive characteristics: the basis of CIT administration is law on CIT, tax administration and other related legal regulations; CIT administration is mainly done mainly by administrative methods and in combination with other